6 Pieces of Advice for Starting a Consulting Business
Embarking on your consulting business is like setting off on a journey. The more prepared you are, the smoother the trip and the more you’ll enjoy the destination. So, let’s get you well-equipped with these six valuable pieces of advice, each aimed at a critical aspect of your new venture.
1. Pre-Planning is Critical
Pre-planning is like drawing your roadmap before setting off on your journey. Whether you’re moving from a structured corporate job or starting fresh, transitioning to a consulting business requires a significant mindset shift. You’ll wear many hats as a consultant, handling tasks from client management to marketing, finances, and more.
Visualizing your everyday operations is an essential part of pre-planning. This exercise helps bridge the gap between theory and reality. It allows you to mentally prepare for your new venture, so it’s not a plunge into the unknown when you step into the business.
Pre-planning also encompasses educating yourself and expanding your network. Attending seminars, reading relevant literature, and connecting with established consultants can be a game-changer, providing insights and shortcuts you’d otherwise learn the hard way. Events like Brand in Demand Live offer a wealth of knowledge and networking opportunities that can accelerate your startup journey.
2. Get to Know Your Financial Landscape
When starting a consulting business, understanding your financial landscape is a must. It’s about being aware of your current financial position, having a savings cushion, planning your operating budget, and preparing for the initial costs.
Just remember, your financial well-being isn’t solely your concern. It impacts your business’ stability and potential for growth. Ensuring your finances are in order is just as important as having a great business idea. So, plan wisely, set clear financial goals, and, most importantly, balance your professional ambitions and personal financial responsibilities.
To calculate your startup costs, check out this tool from the Small Business Administration.
3. Discover Your Niche and Thrive
Don’t be the jack of all trades, master of none. Focusing on a specific niche allows you to become an expert in one area. Your focus should be on delivering high-quality consulting services to a select audience, which boosts your credibility and value in the marketplace.
Choosing a niche isn’t limiting; instead, it’s about finding a space where you can excel and offer unparalleled expertise. It allows you to create a consulting business where whenever someone thinks of your specific area and audience, they immediately think of YOU. Remember the mantra: “Niche to get rich!”
4. Embrace the Art of Selling
Sales isn’t a dirty word; it’s the lifeblood of your consulting business. Many consultants shy away from selling, viewing it as an uncomfortable task. However, successful consulting hinges on your ability to sell not just your services but also yourself.
Selling is an essential skill in acquiring clients and growing your business. But remember, selling is not just about convincing clients to buy your services. It’s about building relationships and trust.
For consultants, it’s also about building and selling your personal brand. Having a strong personal brand can significantly boost your consulting business. It helps you stand out, establishes your credibility, and makes you more memorable to potential clients. If you’re unsure how to start building your personal brand, Brand in Demand Live is an excellent event to attend because it provides valuable guidance to consultants looking to develop a strong personal brand.
5. Keep Your Eyes on the Profit Margins
Financial success in a consulting business is not just about bringing in revenue—it’s about how much of that revenue remains after covering your business expenses. That’s where profit margins come in. Profit margins give you a clear picture of the health of your business, indicating whether your income covers your expenses and leaves room for growth.
Monitoring your profit margins is vital to running a profitable consulting business. It enables you to make informed decisions and strategize for the future. So, don’t just focus on your revenue numbers. Keep your eyes on the bottom line and ensure you generate enough profit to sustain and grow your consulting business.
6. Develop a Robust Business Plan
Your business plan is your consulting venture’s blueprint. It should outline your marketing strategies and financial projections and include a deep analysis of your business concept. A comprehensive business plan guides your actions and steers your business toward growth and success.
A good business plan includes:
- An executive summary
- A detailed company description
- Market analysis
- An organizational and management plan
- A description of your services
- A marketing and sales strategy
- Funding request and financial projections
When crafting your plan, consider it a living document. It’s not something you create once and stash away in a drawer. Especially during the early years, you’ll want to revisit and revise your plan every few months to ensure you’re on the right track and responding appropriately to any unexpected challenges or opportunities that arise.
Balance Your Old Job with Your New Venture
A word of advice: don’t be in a rush to quit your day job. Juggling a job while setting up your consulting business may sound daunting, but it can actually serve as a safety net, providing financial stability as you establish your new business. It’s okay to wear multiple hats for a while as you nurture your consulting business to the point where it can fully support you.
The Road to a Successful Consulting Business
Starting a consulting business requires a blend of expertise, financial understanding, strategic planning, and perseverance. By following the advice in this article, you can set yourself up for a successful transition from employee to entrepreneur (or from small business owner to consultant) while avoiding some common pitfalls. Remember, every step you take towards planning and preparation paves the way for a smoother journey ahead.
Join Us at Brand in Demand Live!
At Brand in Demand Live, we’re passionate about empowering individuals like you with the tools and insights you need to launch your consulting business successfully. Our event brings together industry experts (including me!) who offer actionable advice on how to establish a well-known national brand and catapult your brand to new heights. Don’t just start a consulting business—build a brand in demand! I’d love to tell you how, so join me in Philadelphia in September for Brand in Demand Live!